Being "called away" means your 100 shares of stock have been sold (assigned out) because the stock price rose above your covered call's strike price at expiration. This is the successful conclusion of Phase 3 of the wheel strategy.
Is Being Called Away Bad? Not necessarily. If your shares are called away at or above your Adjusted Cost Basis, the transaction is profitable. The key is ensuring your CC strike is always set above your ACB.
The Emotional Trap: If the stock has rallied dramatically above your CC strike, you may regret selling the CC because you "left money on the table." This is a behavioral bias. You must evaluate the trade's profitability based on your actual ACB and the premium collected — not on what the stock could have been worth if you held without a CC.
Examples of Called Away in Action
- 1Shares of AAPL called away at $180 when the stock closes at $185 on expiration Friday — the CC was profitable.
- 2Called away at $150 on a stock now trading at $170 — the extra $20 was capped by the CC. The wheel resets by selling a new CSP.
- 3Shares called away with ACB of $147 and CC strike of $150 = $3.00 capital gain + $2.50 in premiums collected throughout the campaign.